## Notes from 03 May 2025 [[2025-05-02|← Previous note]] ┃ [[2025-05-04|Next note →]] [Ann Lewis's article](https://www.niskanencenter.org/how-to-save-a-billion-dollars/), "How to save a billion dollars" (published by the [[Niskanen Center]]), provides a sharp analysis of why large government projects, especially in technology, often stall despite significant investment. The proposed solutions (emphasize results, continuously fund capabilities, build internal expertise, ensure flexibility, focus on users, and demand accountability from leadership) are all excellent. They align well with [current thinking](https://www.niskanencenter.org/the-how-we-need-now-a-capacity-agenda-for-2025/) about improving government services and provide a valuable roadmap. The article's core principles, while framed through technology, have universal relevance for improving _all_ public services. Whether managing education, health care, or social services, the same pitfalls exist and similar solutions apply. Focusing on student learning outcomes rather than curriculum delivery, planning for health prevention beyond building clinics, or piloting a social program with citizens before full rollout-these directly translate the wisdom of the article into non-technical domains and highlight basic good management practices. However, implementing these sensible approaches faces formidable obstacles within many public sector structures (specially in Brazil), starting with **deeply dysfunctional human resource systems.** It is incredibly difficult to attract, evaluate, and retain people with proven management experience. Recruitment often prioritizes memorized knowledge tested by exams, or simple tenure, over demonstrated skills. Human resource structures are often organized around rigid, lifelong _careers_, often reinforcing corporatist interests, rather than a flexible _position-based system_ defined by current needs and required skills. While job _stability_ in the civil service has its merits, when combined with weak initial hiring processes and ineffective performance management, it significantly hinders organizational adaptability, making it difficult to build dynamic teams with the right skill mix or to address underperformance. These HR failures fundamentally block the development of the strong internal capacity the article rightly advocates. Beyond HR, other systemic rigidities create immense inertia, usually protected by conservative interpretations by internal legal bodies whose job often seems to be to stifle innovation. For example, there are entrenched budgetary rigidities that lock funds into pre-defined silos regardless of outcomes. These manifest themselves in harmful dynamics such as "use-it-or-lose-it" budgeting, where agencies rush to exhaust annual allocations to avoid future cuts, and rigid procurement norms that prioritize formal parity over strategic value. In many cases, treating all vendors or candidates as interchangeable becomes more important than rewarding those with a proven track record of delivering results. As [[Steve Foreshew-Cain]], former Executive Director of the [UK Government Digital Service](https://www.gov.uk/government/organisations/government-digital-service) (2014-2016) [observes](https://www.computerweekly.com/opinion/Beyond-the-usual-suspects-Whats-really-blocking-public-sector-tech-reform), at the heart of these challenges lies "_the culture of the civil service_" - not the civil servants themselves, who are often highly skilled and mission-driven, but rather a system shaped over decades to avoid risk and manage complexity through bureaucracy rather than collaboration and innovation. This cultural dimension compounds the structural problems through a fundamental misunderstanding of digital transformation, treating it primarily as a technology issue when it's really about transforming way people work. Foreshew-Cain's insights align with the barriers identified earlier: digital transformation is fundamentally a cultural and leadership challenge. He highlights how traditional governance reinforces a system where innovation is risky and taking risks is not rewarded, creating incentives that actively resist the necessary cultural shifts. As he argues, the inertial legacy culture defaults to established ways of doing things, even when nobody can explain why, making this cultural inertia more limiting than any outdated technical system. Combined with crippling proceduralism ("red tape") that elevates process over purpose, these constraints distort incentives and inhibit adaptability. This often manifests as what could be called "**delivery theater**" - where organizations mimic modern development practices without actually changing how they work, resulting in "Agile" processes that paradoxically slow down delivery and increase costs. Faced with such profound difficulties in operating effectively, a common workaround emerges: the creation of specialized agencies or public bodies designed to "opt out" of standard rules, achieving operational flexibility by exception. While this "privatization of governance" sometimes produces isolated results, it avoids systemic reform. It promotes dual governance (cumbersome rules for the core bureaucracy, agility for a select few), increasing overall complexity and inequity, rather than adapting core rules to allow tailored flexibility where appropriate. The very difficulty of getting things done effectively _inside_ the traditional system (due to inflexible HR, rigid budgets, procedural burdens and interpretive lock-in) often drives the very problem that Lewis highlights: costly, large-scale outsourcing. Functions are handed off entirely to outside vendors, often at inflated prices, simply because navigating the internal maze is too difficult. This creates a situation where governments struggle to be intelligent clients in the technology marketplace, leading to unhealthy dependencies that further erode internal capability. _The result is essentially paying twice_: once for the underutilized or ill-equipped internal staff bound by rigid structures, and again for the external contractor hired to bypass those structures. So while Lewis's recommendations are invaluable, realizing their potential requires confronting these deep-seated, politically charged issues of civil service structure, administrative procedure, and the vested interests that maintain the status quo. Foreshew-Cain reinforces this perspective, emphasizing that civil servants are constrained by the system they operate within. Both perspectives converge on a similar conclusion: true transformation demands fundamental reform of how government works, addressing not just technical systems but the underlying human resource structures and organizational cultures that shape public sector behavior.